Free Guide to Updating Your Bank Account With the IRS

Why the IRS Needs Your Bank Account Information

The Internal Revenue Service (IRS) maintains detailed records about millions of taxpayers. One of the most important pieces of information they track is your bank account details. This information serves several legitimate purposes in the tax system.

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When you file your tax return, the IRS uses your bank account information to deposit your tax refund directly into your account. Direct deposit is faster and more secure than mailing a paper check. According to the IRS, direct deposit refunds arrive within 21 days of acceptance of your return, while paper checks can take four weeks or longer. The IRS processes roughly 90 million refunds annually, and approximately 80% are deposited directly into bank accounts.

The IRS also uses bank account information when you owe taxes. If you set up a payment plan or payment arrangement with the IRS, providing your bank details allows them to collect payments through electronic withdrawal. This method is often more reliable than mailing checks, and the IRS may offer lower fees for taxpayers who authorize electronic payments.

Additionally, the IRS cross-references bank account information with income reports submitted by your employers, financial institutions, and other entities. Banks report interest income and other financial activities to the IRS. This information helps the IRS verify that income reported on your tax return matches what financial institutions report about your accounts.

If you receive certain government benefits or tax credits, bank account information may be required to process payments. For example, the Economic Impact Payments (stimulus checks) during the COVID-19 pandemic were distributed more quickly to people who had bank account information on file with the IRS.

Practical takeaway: Understanding why the IRS requests bank account information can help you recognize legitimate requests and protect yourself from scams that impersonate the IRS.

How to Update Your Bank Information Online Through IRS.gov

The IRS provides tools on its official website for taxpayers to update their bank account information. These online options are available through the IRS's secure portal and can be completed from your home computer or mobile device.

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The primary way to update bank information online is through the IRS online account tool. To access this service, you need to create or log into your IRS.gov account. The process requires you to verify your identity using either a credential provided by a third-party service (such as Login.gov or ID.me) or by answering security questions based on information in IRS records.

Once you are logged into your IRS account, you can navigate to the section that displays your tax return information and account details. Within this section, there is typically an option to update your direct deposit information. You will need to provide the following details:

• Your account holder's name (the person whose name appears on the bank account)
• Your routing number (a nine-digit code that identifies your financial institution)
• Your account number (typically 10-17 digits, depending on your bank)
• The account type (checking or savings)

You can find your routing number and account number on the bottom of your checks, on your bank's website, or by calling your bank's customer service line. Many banks also display this information in their mobile banking apps.

After entering this information, the IRS system will display a summary for you to review. Check that all numbers are correct before confirming your changes. The IRS website will provide a confirmation message once your information has been updated. Changes made through the online account tool typically take effect within one to two business days, though it may take longer depending on when the IRS processes the update.

The IRS online account tool is available year-round, not just during tax season. This means you can update your information whenever your bank account changes or whenever you want to adjust where your refund is deposited.

Practical takeaway: Keep your routing number and account number readily available before logging into your IRS account, as you will need these details to complete the update process quickly and accurately.

Updating Bank Information When Filing Your Tax Return

Another common way to update your bank account information with the IRS is during the process of filing your tax return. Whether you file using tax preparation software, through a tax professional, or by mailing a paper return, you have the opportunity to provide or update your bank details at that time.

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If you use tax preparation software such as TurboTax, H&R Block, or TaxAct, you will be prompted to enter your direct deposit information as part of the return preparation process. These programs guide you through entering your routing number and account number, and they typically verify that the routing number is valid before you file. The software will also allow you to specify whether you want your refund deposited into a checking or savings account.

For taxpayers who work with a tax professional or certified public accountant (CPA), your tax preparer will collect your bank account information during your consultation. The tax professional enters this information directly into your return before it is filed electronically with the IRS. This approach eliminates errors because a trained professional verifies the information before submission.

If you file a paper tax return by mail, you must include your direct deposit information on the return itself. Paper returns ask for your bank account details in a specific section, usually found on the first page. You must print or write this information clearly, and any mistakes can delay your refund. For this reason, many tax experts recommend that taxpayers file electronically rather than on paper, as electronic filing catches many errors before the return reaches the IRS.

The advantage of updating your information when filing your return is that the IRS receives your current bank details at the same time it receives your tax information. This reduces the chance that your refund will be sent to an outdated account. However, if you file early in the year and your bank account changes later before your refund is issued, you may need to update your information again using the IRS online account tool.

Practical takeaway: When filing your return, triple-check your bank account numbers for accuracy, as mistakes in these digits can cause your refund to be deposited into the wrong account or returned by your bank.

Updating Bank Information by Mail or Phone

While online options are available, the IRS still accepts updates to your bank account information through traditional methods such as mail and phone calls. These options may be preferable for taxpayers who are uncomfortable using online tools or who do not have reliable internet access.

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To update your information by mail, you can send a written request to the IRS. Your letter should include your full name, Social Security number, the bank account information you want to add or update, and a statement that this is your current account. Mail your letter to the IRS address for your state. You can find the correct mailing address on IRS.gov or by calling the IRS customer service line at 1-800-829-1040.

The IRS recommends that you include a copy of a voided check or bank statement with your mailed request. This documentation provides proof that you are the account holder and that the account information is correct. A voided check shows your name, routing number, and account number all on one document. A bank statement also displays this information clearly. Including this documentation reduces processing delays.

Processing times for mailed requests vary depending on mail delivery times and current IRS workload. During busy tax season (January through April), the IRS may take several weeks to process your request. During slower periods, updates may be processed within one to two weeks of receipt. For this reason, mailing your request well before you expect to receive a refund is wise.

You can also contact the IRS by phone to update your bank account information. Call 1-800-829-1040 during IRS business hours, which are typically 7 a.m. to 7 p.m. Monday through Friday. The IRS is closed on weekends and federal holidays. When you call, have your Social Security number, date of birth, and new bank account information ready. The IRS representative will verify your identity by asking security questions based on information in your IRS records before making any changes.

The phone option can be frustrating during peak tax season because wait times can exceed 30 minutes or longer. The IRS has faced chronic staffing shortages, and according to recent government reports, the average wait time during March and April can exceed one hour. Calling during off-peak times such as September or October may result in shorter wait times.